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The link between financial wellbeing and mental health

In 2017, the Stevenson/Farmer review of mental health in the workplace painted a stark picture of the impact mental health difficulties are having on UK employers.

 

They found that poor mental health costs employers between £33 billion and £42 billion a year, with an annual cost to the UK economy of between £74 billion and £99 billion.

 

Clearly that is a huge cost and there are a number of great recommendations for employers in their report, Thriving at Work.

 

One of the low hanging fruit for employers is to address a common cause of mental health issues: financial difficulty. Research by the Money and Mental Health Policy Institute released in May 2017 found a clear link between financial difficulties and mental health.

 

The research found that 41% of employees that identified themselves as financially comfortable reported at least one sign of poor mental health, however this rises to 51% for those just about managing and 67% for people in financial difficulty.

 

The survey found that the consequences of financial worries on an individual’s ability to work include struggling to concentrate, losing sleep, feeling additional pressure and reduced motivation.

 

This two-way street between concerns about money and mental health suggests that providing facilities that lead to better financial wellbeing could also help play a role in improving mental health problems in Britain’s workplaces.

 

Money and Mental Health suggest steps that employers can take to alleviate these issues for their employees, all of which can be addressed by financial wellbeing benefits:

 

  • Boost short term savings: Access to savings of just £1,000 could protect half a million households from problem debt.
  • Support access to affordable credit: 52% of research participants suggested that the provision of affordable credit products through payroll would have helped them.
  • Financial capability: Access to tools and apps can help people to understand and manage their money better.

By providing practical financial support, employers can help manage or mitigate a common cause of mental health issues within their workforce.

 

Getting started

At Salary Finance, we partner with employers to offer a benefit that helps employees improve their lives, by improving their finances.

You can find out more about the link between financial wellbeing and mental health and the cost to UK businesses in The Employer’s Guide to Financial Wellbeing.

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